Employment termination requests decline

Download article in original language : NL9907152NNL.DOC

The total number of requests to terminate employment contracts declined in the Netherlands in 1998, according to the Annual Report on termination statistics, issued in summer 1999. However, the number of requests related to occupational disability has increased.

In the Netherlands, the termination of employment contracts is generally subject to permission from the local Employment Office (Arbeidsbureau). In 1998, the number of such requests to terminate employment filed with Employment Offices noticeably declined compared with the previous year, according to the 1998 Annual Report on termination statistics (Jaarrapportage Ontslagstatistiek). Termination was requested for 39,614 employees in 1998 - a 20% decrease from 1997. The decline resulted in part from the introduction of the Flexibility and Security Act (NL9901117F) which, among other provisions, sought to to put a halt to "pro forma" requests for termination, with the aim of saving on unemployment benefits.

The Annual Report evaluates only the requests to terminate employment filed with Employment Offices. The other avenue to dissolve an employment contract is via the subdistrict court. The latest figures show an unprecedented increase in the number of termination requests filed with the subdistrict court, rather than with the Employment Office.

The Annual Report on termination statistics reveals that in 1998 the number of termination requests on the grounds of occupational disability increased by 4% to 14,071. The total number of individuals in the Netherlands who receive benefits on the basis of the Occupational Disability Insurance Act (WAO) continues to increase and is expected to reach around 940,000 in 2000.

The number of requests filed on economic grounds dropped by a quarter to 18,849, partially attributable to favourable economic conditions in the Netherlands. The decrease has contributed to the low level of unemployment, which dropped to 216,000 at the end of the second quarter of 1999, 50,000 lower than in 1998.

The Annual Report also indicates that individual requests to terminate employment were filed for 37,673 employees, while 1,941 collective requests were made (when a collective request covers 20 or more employees, trade unions must be consulted, in accordance with the Collective Termination Notification Act). A mere 6% of the requests were denied and 19.6% were withdrawn.

More requests to terminate employment were filed for employees 55 years and older than for younger employees. In the past, shedding mainly older employees was common practice as part of major reorganisations. Given the current shortages on the labour market, the limited participation of older people in the workforce in the Netherlands and the threat of age discrimination, this practice has become less common. However, as shown in the Annual Report, it has not yet been phased out.

As in previous years, more requests to terminate employment were filed for women than for men in 1998. In addition, the number of requests filed on the grounds of occupational disability is much higher for older employees than younger employees, and higher for women than men.

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